Production, marketing strategies essential for cattle operation

An old marketing adage goes something like: bought right is half sold.

That may have lost something in the translation, but the message makes sense for ranchers buying cattle for breeding stock or for stocker operations. It takes a lot of homework, says Clay Wright, a livestock consultant with the Samuel Roberts Noble Foundation, in Ardmore, Okla.

Wright discussed best management practices for buying livestock during a recent Basic Ag field day in McKinney, Texas.

“Know your goal,” Wright said. “And make it realistic. Analyze resources, including soils, water and forages. Also indentify restrictions, such as nearby subdivisions or schools.”

He said before a rancher goes to any livestock sale he must have adequate fencing to hold cattle, and smaller facilities to gather and process them.

“A certain knowledge level regarding production must be in place before purchasing cattle,” he said. “And if a landowner has 5 cows he intends to sell in October or 1,000 he plans to retain ownership of until they go to a feedlot, he faces the same responsibility and must understand his duties as a producer.”

He said a production plan should be in place before the cattle are bought. “Determine how long you’ll hold the cattle and establish performance expectations. Develop a basic animal health program with a large animal veterinarian.”

He said the health program helps ranchers select the kinds of animals they need for their available resources. The vet also helps design preventive procedures with vaccination and de-worming schedules.

“But the biggest issue is nutrition and a rancher must understand the specific needs for each class of livestock. He must know about soils and forages and the correct stocking rate.”

Before a rancher buys cattle, he should know how he plans to sell them, Wright said. “For commercial cattle operations, calves are the product and ranchers must understand the seasonal price trends.”

He said that trend has favored selling 700 to 800-pound steers in early December for ten years. The low has been in April and May. Variations will occur, he said, “but following historical price tends is the best option most years.”

Wright said ranchers must be aware of shipping costs and build proper facilities to collect and load animals. “Also be prepared to manage shrinkage. You could lose from 3 percent to 8 percent of an animal’s body weight with one night in a sale barn. At two nights, shrinkage could reach 10 percent.”

He discussed three primary enterprises: registered cattle production, commercial cow/calf operations and stockering cattle over the winter on quality forage.

“Cow/calf operations are the most common in this area,” he said.

The enterprise may determine how a rancher buys animals. Wright said a private treaty, buying from an individual rancher, face-to-face, is his favorite, especially for selecting bulls and replacement heifers.

“You go at a slower pace and can get information on animal health and avoid a lot of health risks. You can also see animals in the pasture and judge their disposition.” He said a main disadvantage is that ranchers who need larger numbers may have to go to several ranches or to bigger ranches.

Even with a private treaty sale, Wright recommends ranchers do their homework and understand the market so they can make a reasonable offer for the cattle they want.

Wright said weekly auctions are his least favorite purchase option. “Things move quickly at auction and it can be confusing. Cattle are also exposed, inadvertently, to other animals from all over and could be exposed to diseases.”

He said a lot of order buyers work auctions and purchase in big lots. “It might be a good idea to hire a reputable order buyer to work auction sales.”

He doesn’t recommend weekly auctions for buying breeding stock.

Special sales may be good options for feeder cattle and replacement females, Wright said. “These sales often offer numbers of uniform lots of cattle and usually have a protocol for health requirements. Still, some exposure is possible.”

He said stocker operators may find “large numbers of healthy calves that are ready to go.”

Other options include video or internet sales. “These are good for numbers, uniformity and defined lots,” Wright said. Often catalogs and health protocols may be available.

He said ranchers should look for uniformity of size and breed in females. “Look for breeds with known maternal instincts. These include Angus, Hereford and Brangus. And the female uniformity must fit into a planned calving season.

“For bulls, look for the ones that will produce the calf you want.”

He said stocker operators also want uniform lots and recommended buyers stay away from thin, light muscled, fine-boned calves. “These animals will not perform,” he said.

“Also, the market likes black cows. No horns is a plus. But think about what you are going to sell before you decide what to buy.”